Executive summary
Three competing macro dynamics are reshaping today’s order:
- Fragmentation: The global order is fragmenting into a multi-speed, multipolar system with widening governance gaps. Power is spread across more actors, operating at different speeds in different domains. Trade, technology, security, and climate now move on different clocks, making agility as important as scale. What is emerging is a patchwork order with no direct modern precedent.
- Cohesion: Values still anchor alliances, while global challenges—including climate change, global health, cybersecurity, nuclear risks, and AI safety—will continue to require structured cooperation beyond ad hoc coalitions or so-called “minilaterals,” even among rivals.
- Competition: Middle powers like Turkey, Saudi Arabia, and Indonesia are gaining greater room to maneuver through issue-based coalitions, though their flexibility is increasingly shaped by U.S.–China competition across multiple domains, including defense, technology, and energy.
These dynamics are reinforced by six underlying structural shifts:
- Demography and economics: By 2050, India and Nigeria will be demographic giants, while Europe, Japan, and China face shrinking populations. Emerging markets are predicted to supply most of the world’s incremental growth, with India, Southeast Asia, and parts of Africa particularly important, while the U.S. and China are expected to remain the largest single-country contributors to growth. Economic leadership, however, will rest less on size than on three factors: economic complexity (the capacity to move into advanced industries), the resilience of supply chains, and the ability to set standards.
- Technology and security: AI, quantum, and biotech will be growth engines and flashpoints. U.S. military primacy endures for now, but regional balances are shifting as India and China, in particular, are expanding their military and technological capabilities. Cyber and AI compress decision cycles, raising the risk of escalation.
- Populism and democratic backsliding: Driven by economic stagnation, inequality, technological disruption, and climate stress, populist backlash has eroded confidence in universal multilateralism and underpinned a two-decade democratic decline. Nearly threequarters of the world’s population now live under some form of autocracy, making democratic recession a structural—not cyclical—feature of the global order. Together, these forces weaken rule-based cooperation and heighten political volatility at both the domestic and international levels.
Shift implications
These global forces play out unevenly across regions and actors. The United States, China, and Europe remain the system’s principal anchors, while pivotal middle powers—from India and the Gulf to Africa, Southeast Asia, and Latin America—are gaining influence as they hedge, diversify, and shape emerging standards. Understanding how these regions adapt to shared pressures is critical to anticipating where the next phase of global leadership and alignment will emerge.
Why it matters
In a fractured, multi-speed world, the challenge for global firms and investors is no longer prediction but adaptation. Universal rules and institutions are giving way to regional systems, competing standards, and political fragmentation. Success will depend on agility—developing regional strategies, building resilience into supply chains, and engaging early in rule-setting across technology, energy, and finance to shape rather than react to the next global order.
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